Location Planning: Production Facility Layout

Manychip Corp has determined that there are three possible general locations for building a key production facility:

1) a rural location in the southwest United States that has offered major tax incentives and promised to make Manychip exempt from certain local environmental restrictions
2) an overseas location in Southeast Asia that will provide low cost labor, no tariffs consisting of 12 - 25 year old employees that have been well-trained
3) a major metropolitan U.S. city that is the most optimal from a workflow standpoint, has minimal tax incentives and more stringent local restrictions with the potential for an excellent employee pool (numbers and quality)

Answer the Following:
1. Identify the ethics implications of each alternative: postulate what situations might prove problematic and describe how the company should handle them.
2. Identify the methods the company should use in making the final decision on this facility location.

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Manychip Corp has determined that there are three possible general locations for building a key production facility:
1) a rural location in the southwest United States that has offered major tax incentives and promised to make Manychip exempt from certain local environmental restrictions
2) an overseas location in Southeast Asia that will provide low cost labor, no tariffs consisting of 12 - 25 year old employees that have been well-trained
3) a major metropolitan U.S. city that is the most optimal from a workflow standpoint, has minimal tax incentives and more stringent local restrictions with the potential for an excellent employee pool (numbers and quality)
Answer the Following:
1. Identify the ethics implications of each alternative: postulate what situations might prove problematic and describe how the company should handle them.
2. Identify the methods the company should use in making the final decision on this facility location.

Identify the ethics implications of each alternative: postulate what situations might prove problematic and describe how the company should handle them.

1) A rural location in the southwest United States that has offered major tax incentives and promised to make Manychip exempt from certain local environmental restrictions

Here the company will have lower costs than the urban location. The low costs will be due to:
- Tax incentives
- Less Environmental conservation cost
- Cheap labour and Land
- Contribution to Rural Development
The disadvantages can be:
- Lack of Availability of Quality Human Labour and other Staff.
- Expensive than South East Asian countries
- Supply chain inefficiency

Thus Many factories have moved to rural America in recent decades in search of comparatively cheap land, labor, and taxes. The attraction is enhanced by fiscal incentives involving tax subsidies of one form or another.
But there is a threat to the rural location from South East Asian countries, which is more cost efficient.

2) an overseas location in Southeast Asia that will provide low cost labor, no tariffs consisting of 12 - 25 year old employees that have been well-trained

The company will have following benefits in South East Asian location:
- Reduce capital investment: It will reap the benefit of less investment in land.
- Focus on Core Competency: Company will be able to focus on its core strength (its talents, skills, and knowledge that differentiate it from its competitors and ...